Chrysler Seeks $5 Bllion More in Fed Loans

Troubled automaker claims it faces bankruptcy without more bailout cash

By Alex Ricciuti
February 18, 2009 3:21 PM
Filed Under: American, Chrysler, Corporate/Financial, Industry

In concert with its cross-town rival and fellow bailout recipient GM, Chrysler is also asking the US government for more money to keep it in business.

Chrysler has asked for an additional 5 billion US dollars in loans, on top of the 4 billion it has already received. Chrysler claims that without the loans, its operating cash will dip below the dangerous level of 2.5 billion and force it to declare bankruptcy. The same situation it was in last December when it petitioned the government for the initial bailout payment.

"Bankruptcy would cost a lot more money and cause tension and concern for dealers and customers, and it's not necessary," says Robert Nardelli, Chrysler CEO.

Chrysler claims its surest path to viability is in its recently founded alliance with Fiat, in which the Italian automakers will receive up to 35 percent of Chrysler equity in exchange for investments in technology and production.

The Detroit automaker has also promised to cut costs by 700 million US dollars per year by eliminating 3,000 jobs and cutting a shift at an undisclosed production plant.

Chrysler will also be eliminating the Chrysler Aspen and PT Cruiser and the Dodge Durango after having already discontinued the Chrysler Crossfire and Pacifica and the Dodge Magnum.

Chrysler is experiencing a severe collapse in sales. Unit sales were down 30 percent for 2008. January sales for this year were down 55 percent compared to January 2008.

 

Source: detnews.com

Comments

Murcielago2006
February 18, 2009 4:49 PM
Don't give them a penny, I really feel sorry for all their employees who will lose their jobs, but Chrysler should just go bankrupt; all they did was waste the first loan they got on unnecessary BS.

awhk
February 18, 2009 5:02 PM
Stop screwing up the economy. Please shut down for god's sake and save the world!

speed_freak
February 18, 2009 5:12 PM
They're making crap cars all the time. They deserve to go bust.

cuby
February 18, 2009 5:39 PM
We keep giving money why not file for chapter 11 both GM and this outfit it is better the people will recover and find other work in better managed companies.Our grandkids will pay for cars they never will build stop the MONEY save the world .

awhk
February 18, 2009 5:48 PM
Don't think they will last that long.

Bristol411S3
February 18, 2009 7:52 PM
I hat eto say it, for the sake of those that work there, but Chrysler should be allowed to burn.

Joe_Limon
February 18, 2009 8:56 PM
Govt structured bankruptcy ftw! and while your at it, ditch your god damn union!

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